N.Y. Public Authorities Law § 1021-i: Bonds, notes and other obligations of the authority

§ 1021-i. Bonds, notes and other obligations of the authority. 1. The

authority shall have power and is hereby authorized from time to time to

issue its bonds, notes or other obligations, in an aggregate amount not

to exceed one hundred twenty-five million dollars, for the purpose of

financing any capital project authorized by this title, including but

not limited to, the acquisition of any real or personal property or

facilities deemed necessary by the authority, development and

professional expenses, and funding any capital or other reserve funds

established in connection with the authority's operations or issuances,

in such principal amount as the directors shall determine necessary to

perform its corporate duties and further its purposes as authorized in

this title. The maximum maturity of any such bond shall not exceed

thirty years from its date of issuance. The maximum maturity of any such

note or other obligation shall not exceed five years from its date of

issuance.

2. Except as may be otherwise expressly provided by the authority, the

issuance of bonds, notes or other obligations, shall be general

obligations of the authority payable out of any moneys or revenues of

the authority, subject only to any agreements with the holders of

particular bonds, notes or other obligations pledging any particular

moneys or revenues.

3. The authority shall have power from time to time, whenever it deems

refunding expedient, to refund any bonds, notes or other obligations by

the issuance of new bonds, notes or other obligations, up to one hundred

twenty-five million dollars in the aggregate, whether the bonds, notes

or other obligations to be refunded have or have not matured, and may

issue bonds, notes or other obligations partly to refund bonds, notes or

other obligations then outstanding and partly for any other purpose

described in this section. Refunding bonds, notes or other obligations

may be exchanged for the bonds, notes or other obligations to be

refunded, with such cash adjustments as may be agreed, or may be sold

with the proceeds applied to the purchase or payment of the bonds to be

refunded.

4. Bonds may be issued either in a series with multiple discrete

maturity dates or as term bonds with a single maturity date. The bonds,

notes or other obligations shall be authorized by resolution of the

directors and shall bear such date or dates, mature at such time or

times, bear interest at such rate or rates, payable annually or

semi-annually, be in such denominations, be in such form, carry such

registration privileges, be executed in such manner, be payable in

lawful money of the United States of America at such place or places,

and be subject to such terms of redemption, as such resolution or

resolutions may provide. In the event that term bonds, notes or other

obligations are issued, the resolution authorizing the same may make

such provisions for the establishment and management of adequate sinking

funds for the payment thereof, as the authority may deem necessary.

5. The bonds, notes or other obligations of the authority may be sold

at public or private sale for such price or prices as the authority

shall determine. For a private sale of its securities, the authority

shall obtain the written approval of the terms of such sale from the

comptroller if such sale is to a party other than the comptroller, or

from the director of the budget where such sale is to the comptroller,

in either case prior to closing the issuance transaction.

6. Any resolution authorizing any issuance of bonds, notes or other

obligations may contain provisions, which shall be a part of the

contract between the authority and the holders of the issued securities,

as to:

(a) pledging all or any part of the revenues of the authority or its

projects or any revenue producing contract or contracts made by the

authority with any individual, partnership, limited liability company,

corporation or association to secure the payment of the bonds, notes or

other obligations, subject to such agreements with holders of securities

of the authority;

(b) pledging, assigning or creating a lien on all or any part of

assets of the authority, including mortgages and obligations security

mortgages, to secure the payment of the bonds, subject to such

agreements with holders of securities of the authority;

(c) the setting aside of reserves or sinking funds, and the regulation

and disposition thereof;

(d) establishment of special funds for deposit of moneys received from

the proceeds of the issuance of securities as the directors shall

determine, consistent with the authorizing resolution and the provisions

of this title;

(e) limitations on the purpose to which the proceeds of sale of any

issuance of bonds, notes or other obligations then or thereafter to be

issued may be applied and pledging such proceeds to secure the payment

of the bonds, notes or other obligations;

(f) limitations of the issuance of additional bonds, notes or other

obligations; the terms upon which additional bonds, notes or other

obligations may be issued and secured; and the refunding of outstanding

bonds, notes or other obligations;

(g) the procedure, if any, by which the terms of any contract with

bondholders may be amended or abrogated, the amount of bonds the holders

of which must consent thereto, and the manner in which such consent may

be given;

(h) providing for the appointment and powers of a trustee for holders

of securities, and the rights, powers and duties of such trustee as the

directors may determine;

(i) limitations on the amount of moneys derived from a project to be

expended for operating, administrative or other expenses of the

authority;

(j) defining the acts or omissions to act which shall constitute a

default in the duties of the authority to holders of its obligations and

providing the rights and remedies of such holders in the event of a

default provided, however, that such rights and remedies shall not be

inconsistent with the laws of the state and the other provisions of this

article; and provided, further, however, that nothing contained in this

article shall be deemed to restrict the right of the state or of any

municipality to amend, modify or otherwise alter statutes, local laws,

ordinances, resolutions or agreements imposing or relating to taxes or

fees or appropriations relating thereto; and there shall not be included

in any resolution or contract or agreement with the holders of the

bonds, notes or other obligations authorized by this article any

provision which provides that a default shall occur as a result of the

state or of a municipality exercising its right to amend, modify or

otherwise alter laws, ordinances, resolutions or agreements imposing or

relating to taxes or fees or appropriations relating thereto; and

(k) any other provisions not inconsistent with those enumerated in

this subdivision and necessary to effect its issuances of bonds, notes

or other obligations and the rights of the holders of its securities, or

otherwise in furtherance of its corporate purposes.

7. Notwithstanding any other provision of this title, any such

resolution or resolutions shall contain a covenant by the authority that

it will at all times maintain rates, fees or charges sufficient to pay,

and that any contracts entered into by the authority for the sale or

distribution of power shall contain rates, fees or charges sufficient to

pay the costs of operation and maintenance of the project, the principal

of and interest on any obligations issued pursuant to such resolution as

the same severally become due and payable, and to maintain any debt

service coverage ratios and any reserves required by the terms of such

resolution or resolutions. Provided however, that the total rates, fees,

and charges shall not exceed the prevailing electric rate in the North

Country. The prevailing electric rate in the North Country shall mean

the average of the total rates, fees, and charges paid by customers of

National Grid and New York State Electric and Gas, or any successors, in

St. Lawrence, Franklin, and Jefferson counties. Compliance with the

prevailing electric rates in the North Country shall be left to the sole

determination of the public service commission.

8. It is the intent of this title that any pledge of revenues or other

moneys or of a revenue producing contract or contracts made by the

authority shall be valid and binding from the time when the pledge is

made; that the revenues or other moneys or proceeds of any contract or

contracts so pledged and thereafter received by the authority shall

immediately be subject to the lien of such pledge without any physical

delivery thereof or further act; and that the lien of any such pledge

shall be valid and binding as against all parties having claims of any

kind in tort, contract or otherwise against the authority irrespective

of whether such parties have notice thereof. Neither the resolution nor

any other instrument by which a pledge is created need be recorded.

9. Neither the directors of the authority nor any person executing the

bonds, notes or other obligations shall be liable personally on the

bonds, notes or other obligations or be subject to any personal

liability or accountability by reason of the issuance thereof.

10. The authority shall have the power out of any funds available

therefor to purchase bonds, notes or other obligations. The authority

may hold, pledge, cancel or resell such bonds, notes or other

obligations, subject to and in accordance with agreements with

bondholders.

11. Any bonds, notes or other obligations issued by the authority are

hereby made securities in which all public officers and bodies of this

state and all municipalities and municipal subdivisions, all insurance

companies and associations and other persons carrying on an insurance

business, all banks, bankers, trust companies, savings banks and savings

associations, including savings and loan associations, building and loan

associations, investment companies and other persons carrying on a

banking business, and all other persons whatsoever who are authorized to

invest in bonds, notes or other obligations of the state, may properly

and legally invest funds including capital in their control or belonging

to them; subject to the provisions of any other general or special law

to the contrary.

12. The authority is authorized to obtain from any department or

agency of the United States of America or the state or any

nongovernmental insurer or financial institution any insurance, guaranty

or other credit support device, to the extent available, as to, or for

the payment or repayment of interest or principal, or both, or any part

thereof, on any bonds, notes or other obligations issued by the

authority and to enter into any agreement or contract with respect to

any such insurance or guaranty, except to the extent that the same would

in any way impair or interfere with the ability of the authority to

perform and fulfill the terms of any agreement made with the holders of

outstanding bonds, notes or other obligations of the authority.

13. In addition to the powers conferred in this section upon the

authority to secure its bonds, notes or other obligations, the authority

shall have the power in connection with the issuance of bonds, notes or

other obligations to enter into such agreements as the authority may

deem necessary, convenient or desirable concerning the use or

disposition of its revenues or other moneys or property, and for the

acquisition, alteration or disposition of its property, real and

personal, including the mortgaging of any of its properties and the

entrusting, pledging or creation of any other security interest in any

such revenues, moneys or properties and the doing of any act, including

refraining from doing any act, which the authority would have the right

to do in the absence of such agreements. The authority shall have the

power to enter into amendments of any such agreements within the powers

granted to the authority by this title and to perform such agreements.

The provisions of any such agreements may be made a part of the contract

with the holders of bonds, notes or other obligations of the authority.

14. All bonds, notes and other obligations issued by the authority

under the provisions of this title are hereby declared to have all the

qualities and incidents of negotiable instruments under the applicable

laws of the state.

15. Nothing in this subdivision shall be deemed to allow the authority

to exceed its one hundred twenty-five million dollar aggregate debt

limit.